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Archive for the ‘inequality’ Category

“Meritocratic Extremism”

April 14, 2014 2 comments

from Edward Fullbrook

Merijn is ahead of me as I have only just ordered Thomas Piketty’s Capital in the Twenty-First Century. The book is receiving masses of favorable media attention in the West, including from The New Yorker, the Financial Times, the Economist and The Observer where yesterday Piketty and his book occupied the cover of the newspaper’s review section. This attention is surprising given the book’s central message (one often expressed on this blog), that capitalism has now failed the world and that inequality is now accelerating at a very dangerous pace and that the rule of the ultra-rich over the everyone else is a form of gangsterism. The Observer’s feature writer went to the École d’économie de Paris to interview Piketty, and here are a couple of quotes.

Read more…

Chart from the 2014 Economic Report of the President of the USA

from David Ruccio

ERP-productivity

This chart, from the 2014 Economic Report of the President [pdf], illustrates the Read more…

Trickle-down economics — total horseshit

March 3, 2014 15 comments

from Lars Syll

Reaganomics_Trickle_Down

As we’ve been aware of lately there isn’t much trickle-down going on in the USA. Unfortunately we can also see the same pattern developing in many other countries. Take for example Sweden. The figure below shows how the distribution of mean income and wealth (expressed in year 2009 prices) for the top 0.1% and the bottom 90% has changed in Sweden for the last 30 years: Read more…

Inequality

March 1, 2014 9 comments

from Peter Radford

I am preparing a talk on inequality here in America, and so have been re-reading the Piketty and Saez work. Amongst the more eye-opening facts I have come across is the assertion, by Saez, that the surge in the top 1% incomes is so large that the growth of the bottom 99% amounts to only half the average [mean].

Think about that for a moment.

It would be like walking into a room full of people two feet tall with one thirty footer in the corner. The mean average is meaningless in such circumstances. We are all taught that in statistics class, but to come across such an egregious example in a dataset as large as all US tax returns is astonishing. Read more…

Guard labor (chart)

February 18, 2014 2 comments

from David Ruccio

17greatdivide-img-tmagArticle-v3

Read more…

Categories: inequality, Plutonomy

Opportunity Class

February 5, 2014 4 comments

from Peter Radford

America is in such a funk nowadays that sometimes it can get exasperating. The disconnect between what average people believe and hope for, and what seems to dominate our political class is gaping wide open. To me the cause for this disconnect is obvious, and our rampant inequality sits squarely at the heart of the problem. Yet getting some of my erstwhile progressive friends to utter the word inequality has proven to be extremely difficult.

Why?

Because, to their ear it renders a harsh image of envy. And, as we are all taught, since America has no class system, and since America is the land of opportunity, and since in America hard work can get you anything, envy is simply that: a venal sentiment that debases the person harboring it and signifies that they are, somehow, un-American.

This is, of course, twaddle.

Until we are able to talk about inequality without immediately plunging into apologies for being envious we are stuck with what appears to be our favorite surrogate: opportunity. We need, apparently, to restore opportunity in this land of opportunity. Presumably between now and that restoration we are the land of something else, but we won’t give it a name just in case it sounds bad.  Read more…

Categories: inequality

The pernicious impact of the widening wealth gap

January 21, 2014 3 comments

from  Lars Syll

The 85 richest people on the planet have accumulated as much wealth between them as half of the world’s population, political and financial leaders have been warned ahead of their annual gathering in the Swiss resort of Davos.

The tiny elite of multibillionaires, who could fit into a double-decker bus, have piled up fortunes equivalent to the wealth of the world’s poorest 3.5bn people, according to a new analysis by Oxfam. The charity condemned the “pernicious” impact of the steadily growing gap between a small group of the super-rich and hundreds of millions of their fellow citizens, arguing it could trigger social unrest.

inequality-cartoon2

It released the research on the eve of the World Economic Forum, starting on Wednesday, which brings together many of the most influential figures in international trade, business, finance and politics including David Cameron and George Osborne. Disparities in income and wealth will be high on its agenda, along with driving up international health standards and mitigating the impact of climate change.

Oxfam said the world’s richest 85 people boast a collective worth of $1.7trn (£1trn). Top of the pile is Read more…

85 people versus 3.5 billion people – the OXFAM report

January 21, 2014 9 comments

from Edward Fullbrook

In the run-up to the annual Davos get-together of the world’s hyper-rich and their most-favoured agents, OXFAM has issued a report titled “Working For The Few”.  Commenting on it, today’s Guardian notes that

. . . if they fancied a change of scene then the richest 85 people on the globe – who between them control as much wealth as the poorest half of the global population put together – could squeeze onto a single double-decker.

The OXFAM report emphasizes how democracies round the world are increasingly under threat due their subversion by the ultra-rich. Here is a key passage from the report.  Read more…

Economic winners and losers in the US since 2007

from David Ruccio

1230-sub3-rattner-1

As Steven Rattner explains, Read more…

Inequality: government is a perp, not a bystander

December 28, 2013 4 comments

from Dean Baker

In his speech on inequality earlier this month President Obama proclaimed that the government could not be a bystander in the effort to reduce inequality, which he described as the defining moral issue of our time. This left millions convinced that Obama would do nothing to lessen inequality. The problem is that President Obama wants the public to believe that inequality is something that just happened. It turns out that the forces of technology, globalization, and whatever else simply made some people very rich and left others working for low wages or out of work altogether. The president and other like-minded people feel a moral compulsion to reverse the resulting inequality. This story is 180 degrees at odds with the reality. Inequality did not just happen, it was deliberately engineered through a whole range of policies intended to redistribute income upward.  Read more…

‘Tis the season—for inequality

December 6, 2013 2 comments

from David Ruccio
USA
inequality+gaps

Pope Francis challenged the theory of trickledown economics. Now, President Obama has announced his intention to focus on the problem of inequality.

On my reading, Obama’s speech borrows heavily from the ideas in Jacob Hacker and Paul Pierson’s Winner-Take-All Society and Joseph Stiglitz’s The Price of Inequality. Both the best and the worst parts.  Read more…

The End Is Nigh!

October 3, 2013 9 comments

from Peter Radford

The end, that is, of Reaganism.

The Republicans have shut down government because no one is taking their demand that health care reform is abandoned seriously.

In a nutshell the fight is over the part of reform that increases taxes on the top 1% of income earners, reduces subsidies to insurers within the Medicare system, and thus can afford to provide health care to tens of millions of previously uninsured people. That’s it. The Republicans failed to defeat these things during the law’s passage; the law stood up to challenge in the Supreme Court; and subsequently a presidential election was fought, with the winner being the advocate of the law. That’s pretty conclusive. The reform has been constitutionally and electorally approved.

But the extremists now running the Republican party think they can ignore all that. They abhor reform and so have taken to insurgency. Their defense of the wealthy to the detriment of the poor and the sick is open class warfare. It can be construed in no other way. Unless the extremists go through some radical change, their intransigence and defense of the privileged will lap over into a fight over the debt ceiling.

Which is odd, isn’t it? Because the privileged stand to lose the most when our credit worthiness is undermined. They are, after all, the holders of most of our collective wealth.

I see this in historical terms. Read more…

Stiglitz explains how patent protection both slows growth and increases inequality

July 16, 2013 Leave a comment

from Dean Baker

Very nice column from one of my favorite Nobel prize winning economists. Stiglitz explains some of the ways in which patent protection impedes growth and increases inequality.

It’s great to see Stiglitz raising alternatives to patents for financing research, but I would disagree with the prize for patent buyouts that he proposes as being the best alternative. I have always preferred a system of direct upfront funding, which could be done through private firms operating on long-term contracts. In response to a number of requests, here is the argument in brief. (Here‘s a little longer discussion.) Read more…

Taxes, surplus, and the top 1 percent (18 countries)

from David Ruccio

taxes-income shares

We know that U.S. economic inequality—especially the share of income going to the top 1 percent—has been increasing for about three decades. The question is, can the latest research assist us in making sense of the ways top income-earners in the United States have been managing to capture a larger and larger share of the surplus?

In a new paper, Read more…

Inequality and well-being

March 18, 2013 11 comments

from Lars Syll

pickett
Source

Categories: inequality

Inequalities in Asia – Call for papers for WEA online conference

March 9, 2013 1 comment

Call for papers for the Inequalities in Asia conference

Inequalities in Asia

It is generally recognized that inequalities of various kinds have been exacerbated during the period of globalization. This is true of global/regional inequalities as well as within-country disparities, except in a few countries where very conscious policies have been taken to reverse this. Concerns with growing inequality extend well beyond issues of justice and fairness, since the degree of economic inequality also affects social cohesion and political instability, and can also have negative implications for economic growth and sustainability.

This conference will focus on various aspects of inequality in South, Southeast and East Asia from the broader perspective of examining their interlinkages with other economic, social and political processes. This region is known to have been among the most dynamic in terms of income growth as well as structural change, and the evidence of increasing inequalities is also marked in several major countries of the region.

The broad themes to be covered are noted below (I-VII). In addition, some more specific questions that could be taken up in individual papers are mentioned, but these should be seen only as indicative suggestions. Papers that consider other aspects that are not explicitly noted here are also welcome.  Read more…

Categories: inequality

Fix the Debt and a Wall Street Sales Tax

February 15, 2013 8 comments

from Dean Baker

At this point everyone knows about Fix the Debt. It is a collection of corporate CEOs put together by Peter Peterson, the Wall Street private equity mogul. Ostensibly they want to reduce budget deficits and the national debt, but for some reason their attention always seems focused on cutting Social Security and Medicare. While some in this group will allow for minor tax increases, budget cuts are explicitly a priority, with these two programs firmly in their crosshairs.

Given that the stated goal of this group is to reduce budget deficits, it is worth asking why taxes don’t figure more prominently on their agenda. After all, the United States ranks near the bottom of wealthy countries in its tax take as a share of GDP. It is also worth asking why one tax in particular, a financial transactions tax, never seems to get mentioned in anything the group or its members do.  Read more…

Categories: debt, inequality, Plutonomy

Inequality, the Second Great Depression, and mainstream economics

January 22, 2013 22 comments

from David Ruccio

This morning, we’re faced with the extraordinary spectacle of two left-of-center, Nobel Prize-winning economists stumbling all over themselves trying to make sense of the role of inequality in creating and sustaining the Second Great Depression.

Really?! Now, they may have missed the trend of growing inequality over the course of the past three decades. Still, with all the talk of obscene levels of inequality in the last five years and mainstream economists, even the best and the brightest, are still having a hard time formulating a theory about the impact of that inequality in producing the conditions for the crash of 2007-08 and sustaining the recovery that never was.

First, Joseph Stiglitz argued that “Inequality stifles, restrains and holds back our growth.” Then, Paul Krugman responded by telling us he’s not convinced “that this particular morality tale is right.”  Read more…

For the bottom 60 percent of households in the US, wealth declined from 1983 to 2010 (chart).

December 18, 2012 2 comments

from David Ruccio

wealth 1983-2010

Read more…

Categories: inequality, The Economy

Global economic inequality: the billionaires vs. the penniless

September 18, 2012 1 comment

from Deniz Kellecioglu

The top richest individuals of the world have economically recovered from the global financial crises and its aftermath. They are now actually wealthier than five years ago.

A look at the Forbes annual lists of the world’s billionaires reveal that this group had their wealth almost halved between 2008 and 2009. However, this proved to be just a temporary slump as all their losses were recovered in just two years (see table below). If people in poverty could also recover like that, it would be easy to eradicate poverty. Read more…

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